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Borrowing

This guide walks through the end-to-end flow for borrowing the market's loan asset against a Stake DAO strategy position. Borrowing introduces liquidation risk, so keep a buffer and monitor your position. Loan assets are market-specific. Today, only USDC markets are available.

Prerequisites

  • LP tokens for a supported Stake DAO strategy, or RewardVault shares
  • A wallet connected to the Stake DAO app
  • Comfort with borrowing risk (liquidations are possible)

Choose Your Deposit Path

You can enter lending through two paths:

  • LP tokens: Deposit raw LP tokens; the wrapper will deposit them into the RewardVault for you.
  • RewardVault shares: If you already hold shares, deposit them directly for fewer steps.

Both routes end with the same wrapper collateral in the lending protocol.

Step-by-Step Borrowing Flow

Open the lending market

Select a supported strategy in the Stake DAO app and open its lending market.

Deposit and wrap

Deposit LP tokens or RewardVault shares. The wrapper mints a non-transferable token 1:1 and supplies it as collateral.

Borrow

Choose how much to borrow. Start below the maximum and keep a safety buffer.

Monitor your position

Track your health factor and interest rates. Add collateral or repay if risk increases.

Claiming Rewards While Borrowed

Your rewards keep accruing even while your collateral is borrowed. You can claim them at any time by using the Stake DAO application.

Repay and Withdraw

To exit your position:

  1. Repay part or all of your loan asset debt
  2. Withdraw collateral from the lending protocol
  3. The wrapper burns your tokens and returns RewardVault shares

Risk Management Tips

  • Borrow below the maximum allowed (LLTV is not a target)
  • Keep a buffer for price volatility and rate changes
  • Avoid borrowing if you expect major price swings in the underlying LP
  • Check health factor regularly